Why has Today FM folded and what now for Mediaworks?
Thursday, 30 March 2023
ANALYSIS: It was no secret that Mediaworks’ flagship news radio channel Today FM was struggling to attract a viable audience.
But when the end came, it came suddenly on Thursday, which may help explain why many at the radio and outdoor advertising business appeared more shell-shocked by the development than the rest of the media.
Insiders report that even senior news managers at the firm believed it was business as usual on Wednesday, before the order presumably came through overnight from the company’s majority owner, US private-equity owner Oaktree, to cut the news channel.
It might have seemed an omen that Mediaworks director of news and talk, Dallas Gurney, quit the company less than two weeks ago, but that is understood to just be one of life’s coincidences.
So what happened?
**READ MORE:
* 'They've f…ed us': Today FM staff go to the pub, station's fate due to be announced at 5pm
* MediaWorks paying price for chief exec's interest in politics, says staffer
* MediaWorks chief executive Cam Wallace to step down
* MediaWorks to bring news reporting back in-house
**
Today FM’s challenge could be said to have long pre-dated the channel.
It was in 2015 that Mediaworks, which was then a radio and television business that owned TV3, received millions of dollars of investment from Oaktree to combine its television and radio journalism arms into an integrated newsroom, Newshub.
The move made perfect sense given the technology trends at the time.
But it created a snag when Mediaworks succeeded in offloading its loss-making TV arm to US media business Discovery for $20 million in 2020.
Newshub – naturally enough as it was the businesses’ financial millstone –was bundled up with the television business in the sale to Discovery, leaving the rump radio businesses reliant on buying back news coverage from Discovery for its radio channels.
But it was an awkward outsourcing arrangement, given that Discovery did not own its own local radio business, and was probably not helped by Discovery running the ruler over some parts of Newshub in 2021.
Mediaworks had a new chief executive following the sale of TV3, in Cam Wallace who made no secret of his passion for politics.
But it was still perhaps a bit of a surprise when he made the big call to bring news-gathering back in-house later that year, creating a new journalism operation with about 20 staff.
Mediaworks’ signing of former TV3 political editor Tova O’Brien and Duncan Garner soon after was a big coup.
They became the presenters of Today FM which replaced Mediaworks controversy-prone Magic Talk station.
The consensus appears to be that Today FM’s hardworking team make a decent fist of steering Mediaworks current affairs business away from the rocks of far-right talk-back radio.
But insiders say it remained a shoe-string operation while building up a viable business around its nascent audience proved hard yakka.
Mediaworks has traditionally tolerated if not actively encouraged a strong degree of rivalry between its various brands, which is dandy when the business is growing and things are going well.
But within the commercial side of the company there was a feeling the rest of the business was “carrying” Today FM.
Those resentments spilled out into the open in January when Mediaworks announced it would cut about 45 staff and a similar number of unfilled positions, with one source in the business going as to far as to say the company was paying the price for Wallace’s interest in politics.
Its news team was spared the bulk of the January cuts but was asked to make some economies, which an insider says prompted murmurings of industrial action from some already-stretched staff who saw themselves being asked to do more work for no extra return.
Wallace’s departure as chief executive in February, followed by Gurney’s apparently unrelated resignation soon after, left an already somewhat grumpy Today FM crew with few good friends inside the business relying on fading assurances that Mediaworks was backing Today FM for the long term.
Oaktree might have been more patient if there was a realistic prospect of it soon being able to sell its stake in Mediaworks, but after a possible acquisition by Sky TV fell through amid derision from Sky shareholders last year, a dignified exit from New Zealand looks further away than ever.
Against the backdrop of a recession in the wings, Mediaworks’ new unsentimental chief executive Wendy Palmer was left to wield the axe.
The unanswered question facing Mediaworks on Thursday afternoon was where to get the hourly news bulletins and in some cases half-hourly bulletins that its listeners probably still expect its radio entertainment channels to dish out?
Mediaworks spokesperson Yvonne Van Sprang said then that she couldn’t comment on whether its intention was to retain any news-gathering operations or look to outsource that function again, explaining the company was still in a period of staff consultation.
But there wouldn’t seem to be any easy options. Rival radio business NZME is not a realistic partner, Warner Bros Discovery is probably not positioned to pick up where it left off, and RNZ’s content is probably not a great fit, an insider observes.
The solution may be to assemble an even more skeleton news crew from the ashes of what has been a jarring decision to jettison Today FM, but that would seem to be dispiriting for all involved.